Question

A 10-year Government of India bond with a face value of ₹1,000 and a fixed coupon rate of 7% is currently trading in the secondary market at ₹1,050. Which of the following statements is correct regarding this bond?

A The current yield of the bond is exactly 7%.
B The bond’s Yield to Maturity (YTM) will be higher than 7%.
C The bond’s Yield to Maturity (YTM) will be lower than 7%.
D The market interest rates have likely risen since the bond was originally issued.
E The bond's coupon payment will increase to match the current market price.
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